Rocket Lab plans $8 billion Iridium deal to expand satellite communications
Rocket Lab says the acquisition would pair its launch and spacecraft businesses with Iridium’s 66-satellite communications network.
By Maya Lindqvist · Senior Technology Correspondent
2 min read
Rocket Lab has announced plans to buy Iridium Communications for $8 billion, a deal that would move the launch company deeper into satellite-based communications. The agreement matters because it would give Rocket Lab an existing global network, customers and spectrum as it tries to compete more directly with SpaceX.
Rocket Lab is best known for Electron, its small-satellite launch vehicle, and also builds spacecraft. The company said the Iridium acquisition would combine those businesses with Iridium’s communications services and satellite network.
Iridium provides satellite communications to more than 2.5 million subscribers worldwide, according to the company details cited in the announcement. Its service uses a 66-satellite low-Earth orbit constellation and L-band spectrum to connect users in places including ships, aircraft and remote locations.
The deal would give Rocket Lab a communications business rather than requiring it to build one from scratch. In a video discussing the transaction, Rocket Lab CEO Sir Peter Beck said Iridium’s spectrum is hard to obtain and pointed to its customer base and government work as key parts of the purchase.
Beck also described Iridium as a profitable business and said Rocket Lab was not investing in speculation. His comments framed the deal as a faster way for Rocket Lab to enter a market where SpaceX has built Starlink into a major satellite internet operation.
Iridium has previously worked with SpaceX. The company partnered with SpaceX to launch its NEXT satellite constellation in 2019, according to The Verge’s prior coverage cited in the report.
Rocket Lab said it plans to build on Iridium’s network and support deployment of the next generation of Iridium satellites. The company said those satellites will include direct-to-device services, which Rocket Lab says could become an important capability for U.S. national security and emergency response.
The acquisition would place Rocket Lab across more of the space services chain: launching satellites, manufacturing spacecraft and operating a communications network. That broader structure resembles the model SpaceX has pursued with Starlink, which CNBC has reported is currently SpaceX’s only profitable business.
Rocket Lab did not present the transaction only as a commercial communications play. By highlighting government customers, spectrum rights and emergency-response uses, the company tied the Iridium network to both civil and national-security communications needs.
This story draws on original reporting from The Verge.